Pump.fun and Solana: $5.5 Billion Lawsuit Filed Over Memecoin Platform

A class action lawsuit has been filed against the memecoin platform Pump.fun and the Solana ecosystem, accusing them of running an illegal digital casino. The lawsuit, filed on July 22, 2025, in the U.S. District Court for the Southern District of New York, claims losses of $4 to $5.5 billion for retail investors. The complaint argues that Pump.fun operated a racketeering enterprise under the guise of a memecoin launchpad, violating U.S. securities laws and the Racketeer Influenced and Corrupt Organizations (RICO) Act.

Initially filed against Baton Corporation Ltd. (Pump.fun’s operating company) and its three founders, the lawsuit has now expanded to include Solana Labs, the Solana Foundation, and their top executives, including co-founders Anatoly Yakovenko and Raj Gokal, and President Lily Liu. The lawsuit has been expanded to incorporate RICO claims. The defendants are accused of selling securities without SEC registration and failing to provide proper investor disclosures.

Pump.fun, launched in January 2024, has generated over $850 million in revenue through a 1% fee on all token transactions. Plaintiffs claim that 98.6% of the 7 million tokens launched on the platform collapsed into worthless projects. The plaintiffs argue that Pump.fun’s business model constitutes illegal gambling, as it allows users to gamble on token price movements without regulatory oversight.

In addition to securities law violations, the lawsuit includes claims of wire fraud, money laundering, and unlicensed money transmission. The plaintiffs argue that Solana Labs and the Solana Foundation provided the infrastructure that allowed Pump.fun to operate. The complaint claims the platform facilitated gambling by allowing users to place wagers on random events, such as token price fluctuations.

The case has seen several developments. In September 2025, Jito Labs and its executives were dismissed from the case. In December, Judge Colleen McMahon allowed the plaintiffs to file a second amended complaint, which will include new allegations based on over 5,000 leaked chat logs. The court will decide whether the RICO and securities violations are sufficient to proceed with the case.

This case could become a landmark in regulating memecoin platforms and the liability of blockchain infrastructure providers. Solana Labs and the Solana Foundation’s reputations are on the line, and the legal outcome could set a precedent for how decentralized platforms are held accountable.